India has 4th-largest defense budget: report

By Wang Bozun Source:Global Times Published: 2016/12/13 23:58:39

Rift with Pakistan pushes modernization


India has entered the world five largest defense spenders, with much of the budget being aimed at personnel costs and modernization, amid rising tensions with Pakistan on the Kashmir issue.

Tensions between the nuclear-armed neighbors India and Pakistan have spiralled following a deadly assault on an Indian army base in September that New Delhi blamed on Pakistan-based militants.

India, Asia's third-largest economy, has spent $50.6 billion in 2016, up from $46.6 billion 2015. India now has the fourth-largest defense budget, followed by Saudi Arabia and Russia, according to the 2016 Jane's Defence Budgets Report, released by research firm IHS Markit on Monday. Russia slipped to sixth.

A significant portion of India's budget went to personnel costs, according to Craig Caffrey, Jane's lead analyst on the report. Starting 2017, Caffrey expects "a military focused on modernization," which will likely attract weapons manufacturers around the world.

"Procurement spending has been constrained in India over the last three years as personnel costs have increased," Caffrey said in a statement.

"However, what we expect to see from 2017 onwards is a military focused on modernization. India needs new equipment to fulfill its modernization drive. Over the next three years, India will re-emerge as a key growth market for defense suppliers."

"India's military scale, following China's and the US', involves 55-60 percent for personnel expenses and 45 percent in capital investment, an increase of 15 percent in the past decade," Ding Hao, an India military expert from the People's Liberation Army's PLA Academy of Military Sciences, told the Global Times on Tuesday, adding that in order to modernize and diversify its military presence, India also needs to eye European countries like France, Germany and Sweden.

India's military investment has sharply increased from last year given a cut in military expenses among countries like the US, Russia and Japan. However, Ding believes it is not very high as a percentage of GDP despite the increase.

"India's military budget accounts for 1.8 percent of India's GDP, which is below a reasonable level of 2.5-3 percent," Ding said.




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